Extension of Morning Business

EXTENSION OF MORNING BUSINESS

Mr. SPECTER. Mr. President, I will make my points and conclude within 10 minutes. I was on the point that some may charge the United States is there looking for the benefits from Iraqi oil. So long as we use the proceeds for the benefit of the Iraqi people, I don't think anybody can realistically make that argument.

One factor is difficult, and that is, with whom would we contract to make the loan? I must confess that gives me some pause. When a trustee takes over, a trustee is appointed by the court. If a trustee takes over a company that has been mismanaged, or where the directors or officers have committed fraud, the trustee has carte blanche to run the company—in this case, run the country. I believe it would be possible for the United States to undertake what we are doing here, under the watchful eye of others, because others will be watching—we can count on the French for that, if for little else, and we can count on the Germans for that, if for little else. Under the watchful eye of others, we can discharge the fiduciary duty as trustees, and we are good for our word, and we are honorable, and we are there to help the Iraqi people.

While some may doubt that, we can prove it, so that what we do would be used for the benefit of the Iraqi people. There are other ways we might find somebody to contract with. It is my hope the efforts now by Secretary of State Colin Powell to bring in a U.N. resolution will be successful. We have learned from our experience that it is regrettable we could not get the U.N. Security Council to support our military action.

Going back to October 11 of last year, this Senator supported an amendment that would have gone back to the U.N. to try to get more multilateral action. It is true we led a number of nations—"the coalition of the willing"—but it was essentially the U.S. and Great Britain. While it was not quite unilateral, it didn't have the level of multilateral activity which would have been desirable. It is nonnegotiable that our troops would not be under any command other than the United States. But when it comes to the reorganization of Iraq and to what is going to happen in Iraq with respect to how contracts are going to be disbursed and the administration of Iraq, it is my hope the United States can show sufficient flexibility to get other nations to participate. If the United Nations is in, there might be the structure of someone with whom to contract to have these loans instead of grants. I am exploring the issue as to whether the International Monetary Fund or the World Bank might be able to come into the picture at least to have a quasi-trustee status, someone who could oversee the matter, perhaps even contract on behalf of Iraq. These are matters to be explored.

I am advised that the International Monetary Fund is precluded from coming in in the absence of a sovereign, but that if the U.N. passes a resolution, there might be a sufficient basis for the International Monetary Fund to come in. In any event, these are complexities. There are no easy answers.

It is my hope the Senate and the House will give consideration to trying to structure something that would be on the basis of a loan, or perhaps a loan guarantee. We have the precedent with Israel. We are not making grants, we are making loan guarantees. Why should we do more for Iraq than we are doing for Israel with the loan guarantees?

I know that time is a consideration and there is an effort to pass this appropriations bill this week. That may or may not happen. At a meeting of the chairmen yesterday, there was doubt expressed as to whether it could be accomplished this week. We do know we have passed the Defense appropriations bill so that the Department of Defense has some $368 billion to operate. The aspect of this bill on funding the Department of Defense may not require immediate action, although
I would not delay it. I am prepared to move ahead this week and decide all of the issues if we can resolve it this week.

I think there is time to give consideration to a structure of the loan or a loan guarantee. I have consulted with a professor of bankruptcy to refresh my own recollection and my own knowledge on the subject and have been told the concept, the analogy to a bankruptcy, is solid; that there is another concept of "creditor in possession," which would provide an analog in bankruptcy law for us to operate. And as we take a look and search through the possibilities of finding someone to act on behalf of the Iraqi government, I am not suggesting the council that has been created has sufficient authority to contract; but perhaps if we obtain a resolution from the United Nations, we might work in the International Monetary Fund, or the World Bank, or we may be able to structure some circumstance so the loan could be effectuated, or a loan guarantee could be effectuated.

My soundings in my State, and what I hear from colleagues around the country, is the American people have grave questions about our policy in Iraq at the present time, questions about our military being in harm's way, questions about the casualties and fatalities that are occurring, questions about the United States advancing $20 billion to Iraq at a time when we have a very tight Federal budget.

There is talk about the $20 billion, some suggesting for additional domestic programs to offset $20 billion. I do not think now is the time, given the kind of national debt and deficit we are looking at, to be adding more money to domestic spending. Within the past month, I defended on the floor the $137 billion bill on Labor, Health, Human Services and Education and voted against many amendments I would like to have supported on increased education funding, health funding, or worker safety funding. But managing that bill, I opposed those amendments to stay within the budget resolution.

When we talk about a grant to Iraq for $20 billion, there are inevitable questions on how much of that money will go for schools in Iraq, contrasted with how much money is going to be going for school construction in the United States. So I think it would be an act of generosity to make loans, an act of generosity to make loan guarantees. I understand there is considerable support in this body to make an outright grant, but as we consider this issue for the balance of the day and the balance of the week, I ask my colleagues to give consideration to the possibility of making a loan or making a loan guarantee.